As India's millionaire club grows by 11%, the nature of philanthropy in India is changing

Benefitting from the march towards progress, India's citizens have become much more inclined towards philanthropy and are eager to extend a helping hand to their counterparts in rural India.

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Updated: Oct 03, 2018, 03.42 PM IST

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Not only individuals, but companies are also beginning to realize the need to partake in the development process of the country.

By Smita Ram

Back in 2008, when I co-founded Rang De, not many believed that all of us could come together and contribute to a social cause. Most reasoned that '
roti, kapda, makaan' were the chief concerns of every Indian household. One could not possibly spare cash for a startup that wanted to help rural India establish sustainable businesses.

As India grew exponentially over the past decade, so has incomes and charitable initiatives. Benefitting from the march towards progress, India's citizens have become much more inclined towards philanthropy and are eager to extend a helping hand to their counterparts in rural India.

Each year, India's millionaire club grows by 11%, almost double the numbers from a decade ago. A key contributing factor to this occurrence has been the development of an ecosystem that is conducive to entrepreneurship. In 2016 alone, 924 startups received funding from local and international sources, creating rapid advancements on the technological, medical, financial and retail fronts. Consequently, this has helped increase the average household income increase exponentially, especially among the middle and upper classes.

Particularly, the philanthropic sector in India has benefitted from rising incomes, as socially-conscious Indians accounted from the most number of philanthropists across the world. Simultaneously, there was a shift from secular to non-secular giving.

Not only individuals, but companies are also beginning to realize the need to partake in the development process of the country. The 2013 amendment to the Companies Act mandated large companies to spend at least 2% of their average net profit for the last three financial years on CSR activities - another factor that played a major role in thrusting philanthropy rates in India.

While previously we only had access to local concerns, we are now instantaneously aware of problems in other parts of the country. The Internet has played a significant role as well as we are now connected like never before. A powerful example is the manner in which the #ChennaiRains and #ChennaiFloods trended on Twitter towards the end of 2015. Many Indians travelled across the country to volunteer in the city's disaster relief efforts. Crowdfunding efforts enabled NGOs, non-profits and even individuals to raise money to buy basic necessities for those affected by the floods.

This was a prime example of achieving social good by working together and using the internet. Another instance where the Internet has been an effective catalyst in increasing philanthropic efforts in India, is the Facebook group called "Let's Feed Bengaluru" which has provided over 30,000 free meals in less than a year since they began their work in October 2015.

It is heartening to see that working towards the well-being of others is increasingly becoming the norm. Earlier, philanthropy was believed to be only for the wealthy, but there has been a shift in the mindset. Technology has only helped make this easier and equipped individuals with the power of mass media.

One of our benevolent investors, a software engineer in Raleigh, created an online campaign to rally funds on our behalf and raised Rs 63.5 lakhs over four years. It didn't take expensive fundraisers or advertising campaigns, it just took one man who decided to pick up the phone and make over 700 calls to get people involved in the fight against poverty. Another lender on our platform walked 400kms across Rajasthan to raise funds for a weaving community in Jaisalmer. From just two people in Pune who lent to a tiffin stall owner in Nagpur on our platform, we now have over 10,000 individuals contributing to individuals all over India.

Where no contribution is too little, people have come together to give social change a chance. The fact that they are contributing micro-credit instead of donating the funds lowers the barrier to entry as well.

A year on from the launch of Startup India, we are happy to see India booming in across cities. But it is the smaller startups in rural areas - be it a weaving business or a small grocery store in a hamlet - that deserve more support. And, I am happy to see this much required support coming in from India's cities.

I hope this trend continues and philanthropy backed by technology continues to grow in the next ten years. The rest of India stands to benefit in the end.

(The author is the co-founder of www.rangde.org, a P2P lending platform established on Republic Day 2008 that connects lenders to individuals from low-income communities across 17 states in India.)

(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)

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